How to Use Regression Analysis to Forecast Sales: A Step-by-Step Guide There are various ways to understand the effectiveness of your sales team activity or how well sales teams are at driving sales to reach operational and financial goals. Sales forecasting, a method that predicts sales performance based on historical performance, is one way to get this understanding. Sales forecasting is important because it can help you identify what is going right, as well as what areas of your current strategy need to be adapted and changed to ensure future success. For example, if your team is consistently below quotas, sales forecasting can help determine where and why these issues are happening. Forecasting can also help you decide on future business endeavors, like when you’d have the revenue to invest in new products or expand your business.